Dave Inc. quarterly report, Q1 FY2021

Business context and reporting period

Important entity mismatch: The supplied filing is for VPC Impact Acquisition Holdings III, Inc., a SPAC, not Dave Inc. It is an unaudited Form 10-Q for the quarter ended March 31, 2021; its financial statements cover January 14, 2021 (inception) through March 31, 2021. The company had not begun operating and was seeking a business combination.

Key financial metrics

MetricReported amount or status
Operating revenueNone; the company reported no operating revenues.
Net loss$1.65 million from inception through March 31, 2021; basic and diluted loss per non-redeemable Class B share was $0.28. No prior comparable operating period is presented.
Loss components$134,242 formation and operating costs; $919,284 warrant fair-value loss; $600,571 transaction costs allocated to warrant liabilities; offset by $3,691 trust interest income.
Cash flow$1.31 million used in operating activities; $253.77 million used to fund the trust; $255.94 million provided by financing; ending cash was $866,232.
Assets and liquidityTotal assets were $255.89 million, including $253.77 million in trust investments and $866,232 cash. Current liabilities were $83,521.
Debt and other obligationsNo long-term debt reported. A $88,142 related-party promissory note was repaid at the IPO closing. Deferred underwriting fees payable were $8.88 million, due only if a business combination is completed.
Warrant liability and equityWarrant liabilities were $18.91 million. Class A shares subject to possible redemption were recorded as $223.01 million of temporary equity; stockholders’ equity was $5.00 million.

Margins are not meaningful because the company had no operating revenue.

Material changes, outlook and risks

  • The March 9, 2021 IPO issued 25,376,598 units at $10 each, generating $253.77 million gross proceeds; a concurrent private placement generated approximately $7.65 million.
  • Following SEC staff guidance on SPAC warrant accounting, the company restated its March 9 balance sheet and classified public and private warrants as derivative liabilities rather than equity. Quarterly fair-value changes may cause material non-cash earnings fluctuations.
  • Management reported disclosure controls were not effective at a reasonable assurance level because of a material weakness related to warrant accounting. Remediation was ongoing; the filing warns of possible reporting errors, investor-confidence effects, and litigation, though none was known as of the filing date.
  • Management intended to use trust funds primarily to complete a business combination and stated it expected to have sufficient funds for planned expenditures, while noting that higher-than-anticipated search or transaction costs could create a shortfall. No specific target, transaction guidance, or operating forecast is provided in this filing.
  • The company had to complete a business combination by March 9, 2023 or redeem public shares, subject to the terms described in the filing. COVID-19 could adversely affect its financial position or target search, but the effect was not quantifiable.
  • Potential working-capital loans from the sponsor or affiliates were permitted but not committed; none were outstanding at March 31, 2021.

Important facts for investors to verify

  1. Confirm the issuer: this filing is for VPC Impact Acquisition Holdings III, Inc., not Dave Inc.
  2. Review the warrant-accounting restatement, valuation assumptions, and ongoing earnings impact of liability remeasurement.
  3. Assess progress and financing needs for a business combination, including redemption levels, transaction costs, and the March 9, 2023 deadline.
  4. Track remediation of the disclosed material weakness and any subsequent control findings or related litigation.
  5. Reconcile the trust balance, redeemable shares, deferred underwriting fee, and available cash when evaluating liquidity.